Part of Public Authorities (Fraud, Error and Recovery) Bill – in a Public Bill Committee at 2:45 pm on 11 March 2025.
Rebecca Smith
Opposition Assistant Whip (Commons)
2:45,
11 March 2025
Schedule 5 makes provision regarding direct deduction orders from bank accounts. These can be regular or lump sum. The Secretary of State may make a direct deduction order in respect of a joint account only if the liable person does not hold a sole account in respect of which a direct deduction order may be made that would likely result in the recovery of the recoverable amount within a reasonable time. I would be grateful if the Minister explained what criteria will be used to decide whether a person has such an account. This came up last Thursday in relation to the main bank account of a claimant and the fact that the DWP will not be able to ascertain what other bank and savings accounts may be held. Is the same true here? Is this relevant only if the joint account is the account into which the benefits are paid? For the record, I am referring to column 238 of Hansard on
The schedule will give the Secretary of State a power to request bank statements that is not time limited. It will also give the Secretary of State the power to request from banks details about the accounts that a person holds with that bank. The Secretary of State can set out how and when the bank must comply with the notice, and explain that the bank may be liable for a penalty under it if it fails to do so without a reasonable excuse. Can the Minister reassure the Committee about his planned engagement with banks—indeed, has he already had such engagement? Do banks think that this is a manageable requirement, and what will the costs of administering it be? Should that engagement with banks be due to happen, what might be done to reflect their views?
We have discussed that there is quite an onerous expectation on banks. The Parliamentary Secretary, Cabinet Office, the hon. Member for Queen’s Park and Maida Vale, made a comment, in terms of the Cabinet Office powers, that it was almost the banks’ civic duty to make sure that they do this. I am intrigued to know whether they agree with that. It would be interesting to know what engagement Ministers have had, and what they will do about it. Lastly, how long will banks have to comply with notices, and what level of penalty will be levied on them if they do not comply? I think those are fair questions.
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